The dual threat of consultancies and in-housing has put traditional ad agencies under threat, but the role of the agency should be on the ascendancy as clients need more help than ever to handle their campaigns say Chris Dobson, CEO at programmatic trading house The Exchange Lab. In this Q&A, Dobson discusses how agencies can capitalise on the current market conditions, as well as the need for data alliances in the video marketplace, and how The Exchange Lab prepared for GDPR.

How would you describe The Exchange Lab proposition and the role it plays within WPP? Do you still classify yourselves as a ‘meta-DSP’?

The term ‘meta-DSP’ has been retired as it represents only a small part of our current capabilities. The natural consequence of our technology and our approach is the flexibility to use multiple vendor partners including DSPs, ad servers and viewability providers. This allows us to pick the best partners in real time and by geography to ensure we optimise to the results a client is seeking. It also means that we can fit to a customer’s preferred partners as required.

How we handle and conform data is the core of our proposition and capabilities, and we built our proprietary programmatic technology, Proteus, to solve the challenges for marketers inherent in the programmatic industry. As such, Proteus can be an end-to-end operating system, offering complete flexibility to unify, manage and enrich data from the different programmatic technologies selected for or by our customers. Alternatively it can be used as stand alone components depending on the needs of the agency, client and territory. Proteus achieves this through integration with the world’s leading programmatic vendors and suppliers; translating disparate data sources into a single, comparable format to enable analytics and optimisation.

This is hugely important for our clients and agency customers, as it provides them with a transparent view of the complex programmatic marketplace, and allows programmatic specialists to make informed media and optimisation decisions on behalf of their clients.

As most video continues to be traded directly, what are the advantages to using more than one DSP for video campaigns?

It’s crucial not to look at campaigns in silos. Virtually every campaign will include video, but also mobile and display, because advertisers executing video directly tend to silo that component without considering the fact that a consumer operates across multiple devices and multiple screens. Video is simply another channel in the mix, which we optimise alongside other channels consumers engage with, depending on their age group or demographic.

One of the biggest challenges with video is that YouTube, the largest player in the space, operates within a walled garden, so combining it with other formats and providers is not easy. We help clients work around the restriction of the walled garden through our access to Google’s stack. We can create views of video performance from inside and outside Google, and make trading decisions on campaign effectiveness across the media mix.

We see video advertising increasing as the industry begins to apply the same principles it has applied to display. Increasing numbers of players, particularly in the US, are announcing data alliances to bring into the video marketplace, such as the new conglomerate of Comcast and NBC Universal, which is now trading on data rather than gross rating points (GRPs).

While this is great news, it’s long overdue. In the UK, The Broadcasters’ Audience Research Board (BARB) is toying with data partnerships and investigating improved capabilities. This needs to be its primary focus since maximising data is an absolute necessity as video erupts. All the regulations we apply to display must also apply to video but we do need to recognise that TV has some best practices in terms of regulation.

We’re seeing agencies shift towards a more consultative model. What role will proprietary technology have to play in the future agency model?

The reality, especially where larger agencies are concerned, is that their business model is under increasing pressure from changes in the marketplace, particularly from disruptors and consultancies such as Accenture.

The challenge for agencies moving forward is how they re-inject perceived value into their offering, so it closely reflects the complexity of the numerous tasks and advice they give on behalf of their clients. If anything, the role of agencies should be in the ascendancy, because clients need more help, rather than less. To that end, what agencies have to do is differentiate themselves from each other and newer disruptors.

Having ownership of a proprietary technology or system is a major driver for that differentiation, creating a premium value service that cannot easily be duplicated by competitors. Only by combining consultative intelligence and advice with an exclusive technology offering, will they be seen as more than a commoditised buying space.

However, it is important to remember that whatever your service or offering, it is only as good as the expertise of the userbase. We are still a long way from AI when it comes to brand advertising. Agencies must continue to prove to clients – especially those clients toying with in-housing – that the secret sauce for success is the people behind the proprietary technology, who are pulling the levers and operating the systems.

How did you prepare for GDPR?

We looked at GDPR from two perspectives: first, our own data compliance, and second, the compliance of our partners. We process large amounts of data through our data management platform (DMP) and it’s critical that any DSPs we work with comply with the GDPR to the most stringent standards. Customer data privacy is of paramount importance and in addition to our own rigorous internal audits, we have requested all our suppliers sign a data protection agreement.

Rather than presenting a burden, GDPR offers a refreshing opportunity to place the customer at the heart of digital advertising and in turn, help restore trust, quality and transparency to the ecosystem.